Sears to offer DieHard power accessories for sale at other retailers

(Crain's) -- Sears Holdings Corp. said Thursday that it reached a trademark licensing deal to offer DieHard-branded battery chargers and other power accessories at non-Sears retail outlets.

The agreement with Mount Prospect-based Schumacher Electric Corp., a maker of car battery accessories, is Sears' first foray into selling a segment of its key brands outside of the Hoffman Estate-based retail chain.

Chairman Edward Lampert has hinted over the past couple of years of the possibility that the company would sell the brands -- including DieHard, Craftsman tools and Kenmore appliances -- outside of the chain.

In a 2009 letter to shareholders, Mr. Lampert said Sears has "begun exploring alternative ways to create value from our Kenmore, Craftsman, and DieHard brands and to infuse them with even greater innovation."

The company, under Mr. Lampert, a hedge-fund financier, has struggled to find solid financial footing since the merger of Sears and Kmart in 2005. Some analysts have raised concerns that the strategy of selling outside of the Sears stores will lure the much-needed traffic to other retailers.

"They want to monetize their existing brands through other distribution channels," said Bill Dreher, an analyst at Deutsche Bank in New York. "But we believe it's a very high-risk strategy. DieHard is one of the brands that make Sears stores a destination shop. People go out of there way to get the Sears DieHard brand."

Today's announced deal includes DieHard battery chargers, jump starters and power inverters. The company did not specify which retail chains would be offered the accessories.

Guenther Trieb, senior vice-president and president of brands, refuted the notion that the retailer will hurt its own business.

"This is a strategic move to drive overall value in our DieHard brand," Mr. Trieb said. "It helps us to broaden the customer base, which is one of the most important things in building brands."

Sears has shown some signs of improvement. In January, the company predicted earnings of $3.36 to $4.06 a share in the quarter ended Jan. 30. The increase from $1.55 a share in the fourth quarter of last year stems in part from an expected 2.6% jump in quarterly sales at Kmart stores. Kmart also reported a 0.5% rise in same-store sales in the third quarter.